Oregon Business Development Department
Chapter 123
Division 674
STANDARD EXEMPTION ON TAXABLE ENTERPRISE ZONE PROPERTY
123-674-5300
Buildings, Structures and Other Real Property
For purposes of real property in an enterprise zone to be exempt under ORS 285C.170 or 285C.175:
(1) The following do not qualify, unless the cost of all such property collectively in a single property schedule under ORS 285C.225 equals or exceeds $50,000 in total:
(a) New construction of or additions, modifications or improvements to a building or structure; or
(b) Real property machinery & equipment as newly installed or as modified according to section (5) of this rule.
(2)(a) Qualified property, including but not limited to a building or structure, is severable under ORS 285C.180(5), such that:
(A) A part of the building or structure may be exempt, even if another part of the same building or structure is owned or leased by a different business firm, used for ineligible activities, or otherwise not subject to the same exemption; and
(B) The amount of property value that is exempt shall be determined through pro rata calculation based on floor area or other reasonable method, as preferably considered with the Preauthorization Conference, and verified by the zone sponsor as necessary.
(b) Such severability does not pertain to timely Application under ORS 285C.140(1); for example, later construction of portions of a building may not qualify if any such work began before submission of the Application, although subsequent installation of machinery & equipment in general may.
(3) Landscaping or comparable elements may qualify, for example, at a golf course in the case of a hotel, motel or destination resort under ORS 285C.185(4), if classified by the county assessor as structural improvements rather than enhancements to the land.
(4) The exemption on qualified additions, modifications, reconditioning, refurbishment, retrofits or upgrades under ORS 285C.175(3)(b) is measured in each year by:
(a) Computing the assessed value of such taxable property (lesser of real market value or maximum assessed value in each case):
(A) With such qualified improvements or changes; and
(B) As if such qualified improvements or changes had not happened (that is, the assessed value that would have been subject to taxation) but accounting for other concurrent changes to the property.
(b) Taking the difference between the values described in paragraphs (a)(A) and (a)(B) of this section, such that any negative difference equates to zero.
(5) Modifications to an item of machinery & equipment qualify under ORS 285C.190 only if it is real property, and all of the following are true:
(a) Descriptions in the Application (including as amended) recognize such modifications as a basic property type;
(b) On the date of Application the property was idle or not in use;
(c) That period of idleness already has or ultimately does encompasses 18 or more consecutive months;
(d) Previously, the item had been in actual use for 12 or more consecutive months in the same county or zone as where it is placed back into service;
(e) Work to modify the item commenced on or after the date of Application and the enterprise zone’s designation or amendment;
(f) The total cost of modification equals $50,000 or more; and
(g) It is placed back into service no more than 12 months before the first exemption year pursuant to modifications.
Statutory/Other Authority: ORS 285A.075 & 285C.060(1)
Statutes/Other Implemented: ORS 285C.175, 285C.180, 285C.185 & 285C.190
History:
OBDD 8-2020, amend filed 08/12/2020, effective 08/12/2020
OBDD 14-2016, f. & cert. ef. 9-16-16
OBDD 15-2012, f. & cert. ef. 8-15-12
OBDD 27-2010, f. & cert. ef. 6-14-10